Royal commission a witch-hunt: unions

LABOR leader Bill Shorten says any royal commission into the unions should also focus on dodgy employers, but corruption claims should be investigated by police.

Prime Minister Tony Abbott will reportedly announce a royal commission into unions this week, with the terms of reference to investigate bribes, secret commissions, corruption and slush funds.

Former High Court justice John Dyson Heydon will head the 12-month inquiry, which will have the power to compel union leaders to give evidence, News Corp Australia reports.

In an interview with Sky News, Mr Abbott didn't confirm the report but said a wide-ranging inquiry was needed following recent credible claims of widespread union corruption.

He urged Labor to show support, saying Mr Shorten's insistence that the judicial system was sufficient to prosecute union corruption sounded like "a protection racket for a protection racket".

The prime minister said in-house inquiries were inadequate, citing the Fair Work Commission's investigation into the Health Services Union which took four years to get a result.

A royal commission would go much further than the promised judicial inquiry into the Australian Workers' Union slush fund scandal, and was first flagged after the airing of corruption claims involving the Construction, Forestry, Mining and Energy Union (CFMEU).

Mr Abbott said it was necessary at times to "shine a great big spotlight" into the workings of public organisations.

"It's only then, when the great big spotlight has been shone in, that we can see the law enforcement agencies doing their job properly."

Mr Shorten called for a joint police taskforce into allegations officials had been involved in bribery, extortion and kickbacks, and linked to organised crime on major projects such as Sydney's Barangaroo development.

The royal commission was a political stunt that would cost more than $100 million, he said.

"This is a job for police, not politicians," Mr Shorten said.

"The politicians should get out of the way and let the police get on and do their job."

Asked if the royal commission should also investigate employers, not just union officials, Mr Shorten said: "I've got no doubt that if there's a royal commission everyone would get looked at, employers and union reps.

"The government just wants to say that if there is any problems in building and construction, it's a union issue."

ACTU president Ged Kearney dubbed the commission an expensive "witch-hunt", and said it was police who should probe union corruption.

She linked the commission to the coalition's recent attack on "overgenerous" enterprise agreements at companies such as SPC Ardmona, and its Fair Work Commission submission calling for a rethink on penalty rates.

"Australians are very cynical about this," she said.

"They'll know this for what this is."

The Greens also called for a police investigation.

"The Australian people will see (a royal commission) for what it is, the first step in the government's assault on wages and conditions," Greens deputy leader Adam Bandt said.